Congress

At home and abroad, worries mount over Obama’s trade pact

The Hyundai Shanghai ship sits docked as cranes load and unload containers at the Port of Los Angeles in Los Angeles, California, U.S., on Thursday, June 11, 2015. While the House of Representatives reversed itself and voted 218-208 to advance the trade promotion measure on Thursday, June 18, 2015, President Barack Obama will face a much heavier lift in coming months in getting Congress on board with the Trans-Pacific Partnership, a 12-nation deal.
The Hyundai Shanghai ship sits docked as cranes load and unload containers at the Port of Los Angeles in Los Angeles, California, U.S., on Thursday, June 11, 2015. While the House of Representatives reversed itself and voted 218-208 to advance the trade promotion measure on Thursday, June 18, 2015, President Barack Obama will face a much heavier lift in coming months in getting Congress on board with the Trans-Pacific Partnership, a 12-nation deal. Bloomberg

President Barack Obama faces some tough sledding with his lofty hopes on trade.

His long struggle to get Congress to give him trade promotion authority portends a much larger fight over his plan to deliver a Pacific Rim trade pact that would rank as the largest in history.

While the House of Representatives reversed itself and voted 218-208 to advance the trade promotion measure on Thursday, Obama will face a much heavier lift in coming months in getting Congress on board with the Trans-Pacific Partnership, a 12-nation deal that would include Japan and Vietnam.

Even if Obama’s team can quickly conclude negotiations, a final vote would still be months away, giving opponents plenty of time to mobilize. And with Democrat Hillary Clinton and other presidential candidates already making trade an issue in the 2016 race, backers of the proposed trade agreement feel a sense of urgency.

“Either Obama and Congress wrap this up during this calendar year or it is really in doubt,” said Gary Clyde Hufbauer, senior fellow with the Peterson Institute for International Economics.

Worries are mounting at both home and abroad that U.S. clout would take a big hit in Asia if the agreement ultimately collapses, allowing China to play a bigger role in setting rules for the rapidly growing region.

“The U.S. leadership role in the world international economic system would be in remission,” Hufbauer said. And if the TPP fails, he said, it will be clear that the fault lies solely with the United States: “There’s no blaming Japan or Vietnam or Canada or anybody else.”

Sandy Berger, who served as national security adviser under President Bill Clinton, told reporters Wednesday that smaller Asian countries want the United States to be involved in the region as a counterbalance to China, and that the Trans-Pacific pact is regarded as “the signature economic initiative.”

“Our influence in Asia and the perception of our leadership in the world will be substantially affected by the outcome here,” Berger said in a conference call. He added that rejection of the pact would result in Asians concluding “that we’re disengaging from the region.”

“They know China’s going to be there in five years – they don’t know whether we’re going to be there in five years, or three years, or two years,” said Berger, who has lobbied on trade issues.

Hufbauer said a vote against the Pacific Rim trade pact also would have reverberations far beyond Asia. He predicted that it likely would spell the end of Obama’s effort to win a large trade pact with European countries, called the Transatlantic Trade and Investment Partnership.

“The death of TPP would mean probably the death or at least the decline or postponement of all of these other negotiations,” Hufbauer said.

Opponents of Obama’s ambitious trade plans say the worries are overblown and are no reason to pass an agreement that they say would only send more American jobs overseas and depress U.S wages. And they say that trade backers are pushing a strategy they’ve used many times before.

“Time and again, the same foreign policy arguments are trotted out after the economic case fails,” said Lori Wallach, director of Public Citizen’s Global Trade Watch, who opposes Obama’s trade plans.

Among other things, she said the Pacific Rim trade pact would further gut the U.S. manufacturing base while banning “Buy America” procurement procedures for firms operating in TPP countries.

“TPP is not about establishing American rules in Asia – it’s about imposing rules that would hurt most Americans,” she said.

Arthur Stamoulis, executive director of the Citizens Trade Campaign, another group that opposes Obama’s trade plans, said the TPP would give longer patent protections to pharmaceutical companies that would make it more expensive to buy generic drugs while accelerating “a race to the bottom” for both wages and working conditions.

“Railroading through a trade deal that’s unpopular both at home and abroad isn’t the way to shore up America’s standing in the world,” he said.

Congress’ machinations have been watched closely overseas.

When the House first rejected Obama’s request last week, there was quick fallout.

In Japan, Economy Minister Akiri Amari said it would be difficult to hold more ministerial-level talks on the trade pact this month as originally planned.

And in Australia, Andrew Robb, Australia’s top trade official, said it was clear that the Trans-Pacific Partnership had become ensnared in U.S. politics and that its future appeared “quite problematic.”

“You can see the political heat’s rising by the day over there. . . . If it’s not dealt with in the next two or three weeks, I think we’ve got a real problem with the future of TPP,” Robb said in an interview with ABC Radio.

Congress has moved slowly on trade since Obama asked for trade promotion authority in his January State of the Union speech. Under trade promotion authority, also known as fast-track authority, Congress would be required to take an up-or-down vote on future trade pacts, with no filibusters or amendments allowed.

After weeks of haggling, the Senate finally approved the fast-track measure last month. The House followed suit on Thursday, rescuing a plan that it had failed to advance only June 12.

Despite the many delays, some trade supporters say it’s way too soon to panic.

“Trade votes are always difficult,” said Eric Schinfeld, president of the Washington Council on International Trade in Seattle. “They arouse a lot of passions on both sides, but they oftentimes have a way of working out.”

GOP leaders have angered many opponents with their tactics in trying to get trade promotion authority passed.

Last week, they linked the measure with a trade-adjustment assistance bill that would give aid to workers who lose their jobs as a result of international trade. A majority of Democrats balked, voting against the trade-adjustment assistance as a way to thwart the trade promotion authority legislation.

On Thursday, Republican leaders attached the measure to a bill dealing with firefighter pensions.

Harold Schaitberger, president of the International Association of Fire Fighters, called it “a new low,” saying Republicans leaders were using a popular piece of legislation to try to push through the trade plan.

“These tactics fool no one,” he said.

With trade promotion authority now linked to the firefighter pension bill, the measure must now go back to the Senate, where another debate is expected next week. The outcome again is uncertain, with some Democratic senators who backed trade promotion authority last month now irked that trade-adjustment assistance is no longer moving as part of the deal. Republican leaders are promising to deal with that later.

Opponents say they’ll be ready for another fight.

“We look forward to working with senators to defeat it once and for all,” said Stamoulis.

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